11th-hour poll woes raise fears of instability in RP

By Manny Mogato, Reuters

MANILA, Philippines - The late recall of memory cards to be used in voting machines has raised doubts about the success of the Philippines elections to be held on May 10, heightening fears of a contested outcome that leads to instability.

Voters will choose nearly 18,000 national and local leaders on Monday in the country's first automated vote, which is going ahead despite the technical problems.

Before this week's recall, lawmakers, analysts and technology experts had already cast doubt over the process, fearing machine breakdowns and delays or failures in the transmission of results could lead to an outcome as extreme as a failed election.

Election watchdogs have also warned of potential election fraud after some security features of the machines were disabled to get around some technical hurdles.

Such scenarios are making financial markets cautious. Analysts have warned interests rates might rise sharply, the peso may weaken and the stock market could tumble as investors sell out of the Philippines at any hint of political uncertainty.

Here are some scenarios on the possible outcomes:

SMOOTH TRANSFER OF POWER

* The Commission on Elections (Comelec) says a smooth transfer of power is the most likely outcome. This would mean a low failure rate among the 76,340 vote-counting machines being used across the nation.

Comelec estimates that 60-70 percent of the results would be transmitted to central servers within four to six hours of polls closing and some partial, unofficial tallies released.

Such a scenario is possible only if there is a stable power supply and wireless, satellite-based communications facilities function properly, and if voters do not encounter major problems. Analysts estimate voter turnout will be up to 80 percent, or more than 40 million voters.

An extra 6,000 machines are available to replace vote counting machines that break down.

If the conduct of the elections is generally smooth and peaceful, with the majority of registered voters able to cast their ballots, foreign investors may increase their exposure to Philippine stocks and government debt, resulting in a rally in local markets. Barring the impact of global events such as the Greek economic crisis, an inflow of foreign funds would likely see the local currency extend its recent gains.

SOME LOCAL RACE RESULTS DECLARED INVALID

* Comelec could conceivably declare election failures in a few areas where voting did not occur. This could be for a number of reasons, including the absence of election officers, the failure to deliver election machines and materials, or no votes being cast in a precinct.

Voting could also be cancelled due to a natural disaster, violence among rival political groups and presence of armed groups, including those from Maoist-led guerrillas, Muslim separatists and al Qaeda-linked Islamist militants.

This could delay the declaration of local winners, but may not affect national tallies. Generally successful polls would likely cheer local markets, as in the scenario above.

WIDESPREAD PROBLEMS WITH NEW VOTING MACHINES

* Spoiled ballots and unreliable and inconclusive results that may lead to a possible failure to declare clear winners are a real concern.

Under the new system, voters will use a special pen to shade blank ovals beside the names of candidates, instead of writing the names of their selections as before.

A lack of knowledge of the system could lead to delays and long lines at polling booths, where a maximum of 1,000 voters per voting machine will cast ballots from 7 a.m. to 6 p.m on May 10.

Voters within 30 metres of voting centres at closing time will be allowed to cast their ballots. In extreme cases, voting in some areas could last up to midnight.

The possibility also exists that most of the country's rural voters could be disenfranchised, with millions in remote areas and the illiterate unaware or unable to cope with the new method.

A precinct count optical scanning (PCOS) machine will read every ballot cast and produce a tally for the maximum 1,000 voters per machine.

Tests this week found ballots were not read correctly, prompting the nationwide recall. On election day a disputed outcome could provoke protests and potential violence in areas where political rivalry is intense.

Millions of spoiled ballots would cast doubt on the credibility of the poll results. Civil activists and lawyers would likely file election protests, delaying the declaration of winners and possibly triggering street protests. Investors would then likely dump Philippine stocks, currency and debt papers.

CIVIL UNREST OVER FAILED RESULTS

* In a worst-case scenario, thousands of voting machines could malfunction, power could be cut in many areas, and phone networks and election servers could crash. The elections agency is only preparing to count manually about 30 percent of votes in the event of technical and logistics problems.

These glitches would lead to delays or failures in the transmission of results from voting machines to 1,600 city and municipal servers, then to servers at the provincial level. Final tallies at the national level might not be completed if the transmission from servers is disrupted and incomplete. Protests could follow leading to civil unrest.

Only about 60 percent of the country has reliable access to wireless communications. The poll agency plans to use satellite phones to transmit results from remote areas and mountain villages in six provinces without wireless network coverage.

Further, millions of votes may not be counted due to mistakes in filling in ballots. This could trigger massive violence.

Comelec would be deluged by hundreds of protests from disenfranchised voters and political parties, possibly resulting in a power vacuum if no winners are declared on June 30, when all elected officials, including the president, end their term.

Any potential civil unrest and widespread violence could be used by the government as a pretext for declaring martial law, thus extending President Gloria Macapagal Arroyo's term.

In the absence of poll winners at the national level, the country could plunge into a constitutional crisis due to the absence of clear succession procedures.

In such a situation, investors would likely stampede out of all Philippine markets.